Rent vs Buy
Run 2,000 Monte Carlo simulations to compare 30-year wealth outcomes between renting and buying. Adjust assumptions and see probability distributions of real outcomes.
Your Scenario
2,000 paths · 30-year horizonAdvanced Assumptions ▼
Simulation Volatility ▼
Standard deviation of annual returns — higher values produce a wider spread of outcomes.
Runs 2,000 Monte Carlo paths in your browser.
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Adjust your inputs above and click Run Simulation to see your 30-year wealth comparison.
How this works ▼
This calculator runs 2,000 Monte Carlo simulations over a 30-year period. Each simulation randomizes annual home appreciation, investment returns, and rent growth using normal distributions centered on your chosen means with the specified volatility (standard deviation).
Buying scenario
You pay closing costs + down payment upfront. Each year: mortgage payment (P&I), property tax, insurance, maintenance. Home equity builds via principal paydown and appreciation. At sale, selling costs are deducted from gross equity.
Renting scenario
You invest the down payment + closing costs in the stock market. Each year you pay rent + renter's insurance. The monthly difference between the buyer's total housing cost and your rent is invested. Your portfolio grows at the randomized investment return rate.
Comparison
At each year, we compare (home equity − selling costs) vs. investment portfolio. A positive buying advantage means buying has produced more net worth. The verdict reflects the median outcome — half of simulations are better, half are worse.
Limitations
For educational purposes only, not financial advice. Tax benefits (mortgage interest deduction), HOA fees, PMI, and local rent control are not modeled. Consult a financial advisor before making a real estate decision.
About this calculator
Buying a home builds equity over time but involves significant upfront costs: a down payment, closing costs typically totalling 2–5% of the purchase price, and ongoing costs including maintenance (roughly 1% of home value per year), property taxes, and insurance. Renting requires no equity contribution and offers flexibility, but provides no ownership stake.
The break-even point is the number of years at which the total cost of buying equals the total cost of renting. In most markets this falls somewhere between 4 and 7 years, but it varies considerably by location, purchase price, and local rent levels. If you expect to move before that threshold, renting is typically the better financial outcome.